The 'Oprah Effect' can't fix Weight Watchers' biggest problems

Millions of women do. Look no further than her "The
Life You Want" tour for proof that America considers her
a guru amongst gurus.

Weight Watchers shareholders also fell in love with Oprah this
week, after she bought a 10% stake in the company and said she
would join its board. The shares surged on the news.

But investors, betting that Oprah's marketing prowess
will rescue a company whose sales and profits have
plunged in recent years, are overlooking some of the
company's biggest problems. Weight Watchers, whose diet program
has a questionable long-term track record, faces competition from
free apps and changing attitudes toward wellness that will have
more people turning to alternatives.

"Weight Watchers has some
significant business challenges that will not be solved alone —
by even the most resolute celebrity," University of Southern
California marketing professor Jeetendr Sehdev said to
Business Insider.

This isn't to dismiss Oprah's importance. What she endorses, people love.

Take the nineteenth century literary masterpiece "Anna Karenina."
After Oprah gave it her book club's seal of approval in 2004, the
book skyrocketed to #1 on USA Today's Best-Selling List, USA Today reported in 2011. And
companies whose products made it to Oprah's "favorite
things" list faced out of control demand.

At her peak as a television host, she
was "a woman who was very much in control," said
Sehdev.

She "was very much a symbol of the American dream
... she was somebody who worked against the odds to have success,
and a lot people related to her on that
level."

He credits her with bridging racial and
cultural gaps. "She was a unifier," he said to Business Insider,
"and that was very powerful."

And on the surface, Oprah seems like the perfect fit for Weight
Watchers' clientele — she has openly confessed her struggles with her
weight.

"Weight Watchers has given me the tools to begin to make the
lasting shift that I and so many of us who are struggling with
weight have longed for," Winfrey said in a statement. "I believe in the program so much
I decided to invest in the company and partner in its evolution."

If Oprah believes, the public is wont to believe, as
well. But just believing in the product can't actually make
it work.

"Regardless of how much Ms. Winfrey contributes to the
marketing of Weight Watchers, a well-designed new program is
necessary for the company's success," Barclays
analyst Meredith Adler wrote in a
note to clients.

We reached out to Weight Watchers for a response, and will update
this post if we hear back.

Top of the list of its challenges is that the program is
ineffective, according to a Duke University study, which claimed that
Weight Watchers members spend an average of $377 a year on its
services and products — for an average weight loss of 5 pounds.
(There are, of course, anomalies — Tech Insider's Molly Mulshine lost 10 pounds
and claimed it was the only diet that ever worked for her.)

But even if they're willing to give it a try,
peoplehave options outside of Weight
Watchers that are significantly cheaper. Apps like
MyFitnessPal and iTrackBites each simulate an
experience similar to that of Weight Watchers. Why pay for
minimal results when you can pay less — or not
at all?

Further, doctors do not condone its focus on "points" versus
nutrition. "Weight Watchers’ guidelines for healthy eating
are simply unhealthy,"Dr. Joel Furhmanwrote in a blog post,
"and not supported by the most updated nutritional
science."

Society might be shifting towards embracing wellness
versus dieting (think "lifestyle diets" like the Paleo diet).
Weight Watchers has been ostensibly trying to adapt — its
Instagram shows homemade goodies, a departure
from its infamous prepackaged goods. (Still, you can't ignore the
donuts on the page.)

Weight Watchers is banking on a particular consumer, and
that consumer might not be as susceptible to Weight Watcher's
credo as it once was.

"Weight Watchers has
an older audience that skews more female, and Oprah has
[captured] that audience, but you’d be surprised ... that
audience is also changing their mentality very quickly. Even the
35-plus or the 45-plus women in America are constantly changing
their viewpoints," Sehdev said.

Dave Kotinsky/Stringer/Getty
Images

Beyond these challenges, the company might face new problems now
that Oprah is on board.

Oprah has a reputation for yo-yo dieting. And while that might
make her relatable, it's tapping into the wrong sentiment — that
Weight Watchers dieter are also yo-yo dieters — or
worse, failures. The company is banking on relating to failure.

"Tapping into that idea and then
leaving your customers unhappy ... is exactly why that
business is not surviving. If you’re going to tap into those
insecurities of the yo yo dieter, that business is not going to
be around for long because fundamentally, today people who make
sacrifices want to see result," Sehdev said. "That’s the
mentality today."